24. Let i be the rate of inflation and r the nominal interest rate. (We used pi to denote the rate of inflation in the book.) The (exact) real rate of interest is given by a. (r-i)/(i+1). b. (r + i)/(i+1). c. (r+i)/(i-1). d. (r-i)/(i-1). e. r-i/r.

24. Let i be the rate of inflation and r the nominal interest rate. (We used pi to denote the rate of inflation in the book.) The (exact) real rate of interest is given by a. (r-i)/(i+1). b. (r + i)/(i+1). c. (r+i)/(i-1). d. (r-i)/(i-1). e. r-i/r.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

24. Let i be the rate of inflation and r the nominal interest rate. (We used pi to denote the rate of inflation
in the book.) The (exact) real rate of interest is given by
a.
(r - i)/(i + 1).
b. (r+i)/(i+1).
c. (r+i)/(i-1).
d. (r-i)/(i-1).
r- i/r.
e.

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